EBRD revises GDP growth upwards for 2018-2019

At a press conference last month Teresa Czerwińska, the finance minister, said she expects GDP growth to exceed expectations in 2018. Radek Pietruszka/PAP

The European Bank for Reconstruction and Development (EBRD) has raised predictions made in May for Polish GDP growth for 2018 and 2019.

In a report released yesterday the bank put growth for this year at 4.7 percent, 0.7 percent higher than the forecast made six months ago, while in 2019 it could come in at 3.6 percent, 0.3 higher than in the May report.

The bank also stated that the Polish economy grew by 5.1 per cent year-on-year in the first half of 2018, but will end the year at 4.7 percent.

“GDP growth may have peaked in mid-2018, but it is expected to remain robust over the forecast horizon,” said the EBRD report.

The report added that increasing inflation may “soften” household consumption but that will be offset by rising rages resulting from a “tightening” labour market.

Staying on the subject of work the EBRD said that Polish labour market is now facing “significant structural changes”.

“The supply of labour is falling owing to an aging population, the lowering of the retirement age, and the lower participation of women because of higher social benefits,” the report stated, adding, however, that increased immigration from Ukraine and Asia could help counteract any negative effects.

The EBRD also predicted a recovery in investment in Poland, especially within the public sector, in the coming months.